Economic drivers dictate insurance industry growth

CEBU, Philippines - Economic factors promoting “more funds in the Philippines” simultaneously affect the growth of the insurance industry, an insurance executive said. AXA Philippines Zone 3 (Visayas) Regional Head BJ Legaspi said that there is a recorded 21% growth in the entire industry influenced by various economic drivers in the country.

He cited that the Overseas Filipino Workers’ market is a growing industry with US$1.5 billion-remittance reported last year in which 80% to 90% go back to the Philippines, increasing the spending power of Filipinos.

The booming tourism market, he added, also enabled the creation of more businesses and generation of added employment opportunities.

As a country that passed the standards for global English, he also mentioned that the emerging business process outsourcing companies are indicators of a strong Gross Domestic Product and bigger potential of earning money.

He further said that the 3.7% inflation level, fixed peso exchange rate and the balance of exports and imports “rock” the boat of the Philippines towards GDP growth and domestic progress.

“We’re way ahead of other countries. We’re out of the crisis already. Even investors abroad, they’re putting more funds in the Philippines. Now the challenge here is to be innovative and teach them ways on how to save,” Legaspi stated.

He noted that AXA Philippines has enjoyed triple growth for the past years, citing that the company has recorded P39 M revenues on 2009, P83 M on 2010, P110 M on 2011 and started off this year with P200 M.

He said that Cebu is considered to be one of the major markets for AXA and second to Manila zone as it contributes 35% market share to the total sales of the company.

However, he added that there is still a need to educate the people on the need of insurances and promote financial awareness considering the high purchasing power and the capacity to earn.

“Our aim here is not to sell but to teach them. Most of the people right now invest first for “hype”. When you have a lot to invest in, it is always good to diversify your investments and learn how to save. If I can reverse it, life insurance would go first. Your life is more important than anything else,” he said.

Legaspi said that currently, there is 9 - 10% market penetration for the insurance company based in the population of Cebu.

He further said that AXA is able to tailor fit corporate solutions for employees’ benefits particularly the BPO companies that currently has a huge employee population, allowing workers to purchase their own insurances through salary deductions for practicality purposes.

Aside from real estate properties or condominium investments, Legazpi advised the public to avail of different types of insurances such as accident, retirement and credit insurances.

With its commitment to help customers secure, manage and grow their finances, AXA Philippines organizes seminars on financial planning and management nationwide.

Serving more than 100,000 customers, the insurance company rank third based on total premiums with more than P30 billion funds under management. (FREEMAN)